I'm not saying everyone can't get a pay raise, but we can't think linearly here. Semiconductor workers aren't exactly applying for food stamps.
As long as more of the gross profit goes to workers, that's a step in the right direction.
Though I would say the linear solution is paying everyone $6k more, which is much better!
That's now how the lesser paid workers will see it, unfortunately.
>Though I would say the linear solution is paying everyone $6k more, which is much better!
That would be flat (Y = 6000 vs Y = 1.X%). Perhaps better, but I'm not sure if that's been done outside of stimulus checks.
I think what the person up chain was alluding to was to increase minimum wage or similar initiatives. Doesn't help the higher end of the working class but helps out the lower end immensely, and indirectly helps out the middle as well.
- automation, ie order at a kiosk at McDonald's - not hiring for the job because it is not profitable to do.
This is what happens to low skill workers when we make low skill jobs too expensive.
I don't think corporate has ever said "we have too many people who want to work". There will be more jobs out there that can't be automated, at least until we hit Terminator levels of sentience. But by then our robot overlords will solve capitalism for us.
Sounds better than the current situation where the trends are reversed.
Or, notice how ukraine went from "nazi shithole" to "beacon of freedom and democracy" once the war started?
To know how things really are behind the propaganda is basically impossible.
> Of course you will not do that, everyone is a hero on the internet
Well most people don't speak korean…
Start and learn Korean, and then emigrate. Tell us in 30 years time how it went.
I mean it'd be great but is it really feasible?
Salaries for the top 10% or so have increased significantly over the years. Of course it still pales in comparison to how much the incomes of the top 1% increased over the same period (meaning there is enough money/productivity to pay everyone more)
Let go of the finance hallucinations and keep logistics going. Let the fiat rich choke themselves out clutching their pearls
Nihilism is not lack of a philosophical framework, it’s awareness but not acting on it
SWEs could halt the fiat economy tomorrow through collective action, but FOMO on the latest in electron state management is too strong for the geniuses lizard brains I guess
From my experience SWEs are the workers' category least likely to get involved in any kind of collective action. They're too self centered and individualistic for that.
“What’s that? You made purpose built counting machines count? You’re welcome.”
The foot fungus eater and the latest DSL dealer can all pound sand.
I laugh at mathematically correct languages like Haskell. If mathematical correctness is a goal, may as well build it into the chip and leave a small programming environment to correct errors and give up on programming all together.
Not to mention way too well paid, comfortable and with lots to lose. Why risk a very comfortable lifestyle for some noble goal that barely concerns you unless you have tons of empathy?
In order to figure out what activities we ought to allocate resources to, we compare their present values as a sum of future cash flows, each period 'discounted' by a rate. The rate is calculated based on the activities risks + a 'benchmark' or 'risk free' rate. Basically "this activity is risky, how much more should it pay than something totally without risk?"
The closest thing we have to that is US debt. US bonds have a set face value and interest rate, but if you buy above/below the face value, the interest will be a higher or lower return on what you paid, 'yield'. US debt is the most active market in the world, so taking the 'yield' shows what rate the global market[0] is accepting 'risk free' investment.
If the market is nervous, more bonds get bought because everyone wants 'safety'. But this drives up the bond price and lowers yield. Lower yields create an incentive to consider 'hey maybe we do something a little risky after all, it pays better.' Vice versa: if the market is buying risky stuff instead of safe bonds, yields go up and people think 'why do something risky if I can get that return with no risk'?
BUT the Fed interferes in this market. They have unlimited power to buy/sell bonds and therefore establish price ceilings and floors[1]. For most of the past 20 years they created a high price floor, which means low yields. This forces society to allocate resources to risky activity with higher returns.
In particular, when rates go down, cash flows in the future relatively contribute more to present value. With higher rates you look harder at the next 20 years. With lower rates, you look more at years 20+[2].
In practice it made any business that can 'promise the future' an attractive investment. Think Big Tech, VC startups, Tesla, Wework, Theranos. Meanwhile, businesses that are less risky and make goods and services now have to compete with those guys for ROI. If you have little hope of growth, and your business is established you have to raise prices or reduce costs somewhere. You can't control what you pay for raw materials/inputs, but you can control what you pay workers.
To further illustrate: Google burns hundreds of billions on projects that never see daylight or get axed after a couple years. How did market forces decide that was a better use of resources than building (relatively) more hospitals and bridges? Fed yield interference.
I'm not saying high rates are good, or low rates are bad. I'm saying rates that don't match market conditions are bad.
[0] Explainer on the bond market for the uninitiated: Big companies can't safely keep a lot of cash as currency because FDIC insurance is meant for individuals and only covers 250k. Instead you buy something 'safe' and very easily tradeable or 'liquid'. In the past, this might have been gold. Now it's US debt, which works better than gold for this purpose (diff maturities, easier settlement, etc.)
[1] These are decided by a committee of 12 individuals, the FOMC.
[2]To see this for yourself, model out a dcf and then add a column where you divide each discounted cash flow by the present value
I'm even inclined to agree with you: inflation is better and healthier than the financial gimmickry we did in 2008-2010. But the pushback to that seems to be much broader than "Republicans." Biden's approval rating on the economy is at 36%, and it's just 52% among Democrats 18-44. Americans seem to really hate inflation.
Current wages are at the 1993 levels? That's just not true.
https://www.pewresearch.org/short-reads/2018/08/07/for-most-...
Averages also hide very real disparities: software engineers are much better off today than they would have been 30 years ago; truckers, on the other hand, are much worse off today.
When it comes to housing, it's pretty clear how the Fed's monetary policy drove those costs in areas where it is scarce. Luckily counteracting that is simple given political will, at least in principle.
How can that be done without either stoking massive inflation or somehow paying someone else less?
They might indirectly own it, but it is other folks getting rich off of their money.
Realistically, no one should have risk when paying into pensions/retirement for later and it should be somewhat promised. The entire system is reprehensible as it stands.
Prior to that retirement funds were primarily handled by pensions where the company or organisation you worked for put away money for you in a fund and for the employee there was little to no risk that this money would disappear or diminish in value. Behind the scenes the company may invest it in various ways but it was generally a "low risk" retirement fund.
The reason why every company and organisation (other than a handful of government orgs) got rid of pensions and switched to investment based retirement funds was because the risk got moved away from the company to the employee and as a result it was cheaper to operate.
And as an added bonus, now any time we want to consider raising wages or improving things for workers at the cost of shareholders profits, companies can turn around and argue "this is hurting retired people".
So no of course not I don't think retired people should be getting fucked out of the funds they've been paying into for their entire careers but they shouldn't be paying into those funds in the first place. Unless they explicitly opt into that risk, they should be getting access to a pension with guaranteed payout by default.
This is firmly opt-out at this point. Who offers pensions anymore outside of State/Fed (how reliable do we expect those states to be in the coming decades). You can't demand a company provide a pension so it's on you to invest for your retirement ... into what?
Companies don't provide pensions anymore because it is always cheaper for them to provide a 401k or IRA and offload that risk. People only let them do it because we had fairly substantial periods of prosperity where relying on the stock market seemed "guaranteed" even though it is anything but.
What I'm suggesting is that not providing a pension shouldn't be seen as acceptable. I don't know if I'd suggest going as far as mandating it by law but I think workers should be demanding a right to a pension for themselves and all their fellow workers at a given org or in a given industry.
The labor movement is having a bit of a revival at the moment so hopefully unions can start pushing for Qualified Direct Benefit Plans (aka pensions) to be a standard again.
> how reliable do we expect those states to be in the coming decades
The federal government provides guarantees for qualified pensions through the Pension Benefits Guarantee Corporation (https://www.pbgc.gov). Even if the states fuck up, those state employees still get their pensions.
That's the important point. The costs and risks are on the org. They can guarantee the pension with low risk investments or dollar equivalents and have effectively no risk or they can try higher risk investments in an effort to save money but at the end of the day the employee/pensioner gets the amounts promised from the beginning.
1. They can allocate measurably portions of it to low risk investments, bonds, etc.
2. A qualified direct benefit plan (which is referred to as a pension) has guarantees attached to it. Even if the company goes completely under and all that money bursts into flames, the PBGC (https://www.pbgc.gov/) will guarantee the payout of the pension to the pensioner and foot the bill.
I'm not trying to suggest that there aren't costs that need to be borne by someone but forcing the worker to bear those costs seems like it's quite obviously the wrong choice (they should be allowed to bear it if they want to though).
The other reason you're forgetting about is that you can't count on that company actually being in business to provide your pension when you retire. Or not declaring bankruptcy to avoid their pension obligations, as I believe GM did back in 2008. With a 401k/IRA, you don't have that worry: you can contribute to it, and if your company goes belly-up, no problem (well, not for your retirement funds): your money is still there; you can get another job somewhere else and keep contributing to your retirement.
Also, what happens to your retirement funds is strongly controlled by the SEC, unlike company pensions, so there's much less risk for the employee. Of course, the stock market goes up and down a lot, but that can be avoided mostly by directing your funds into safe investments, though your returns won't be that much.
>Unless they explicitly opt into that risk, they should be getting access to a pension with guaranteed payout by default.
That's what government-run pension schemes are for. Government shouldn't be guaranteeing a pension run by a private company.
I'd imagine the typical stock owner by worth of stock owned not remotely being a retired teacher
But the retired teachers indirect stock was also an attempt to get rid of pensions. Why don't we just support retired teachers as they are, instead of tying their well-being to some rich guys?
Not that people shouldn't fight to be paid more, just that it has limited effect unless you happen to get paid significantly more than everyone else compared to what things cost now, and hope that continues forever.
Salaries have largely stayed the same while prices have risen and that excess has gone to profits. If workers demand more pay and they force the issue, the economy eventually will reach equilibrium.
The issue currently is that those workers can't really do that because the US government has shown time and again that they don't really care that much if a company violates organised labor laws or labor laws in general (you get a fine and a slap on the wrist) but they will bring down god's wrath if workers/a union has an "illegal strike" after the employer ignores their demands.
There is a reason why ever since Reagan took a hardline anti-union stance and disbanded the PATCO union for having the audacity to strike in the 1980s that the number of major strikes per year has steadily declined.
https://www.bls.gov/web/wkstp/annual-listing.htm